Sequential Brands Group saw its income and revenue grow over 2016, but the brand portfolio still ended the year on a net loss.
Using generally accepted accounting principles, Sequential posted a net loss of $800,000 for the year ended Dec. 31, an improvement over the $2.9 million net loss for the previous year. For the quarter, the brand portfolio also posted a net loss of $1 million, compared with a net loss of $5.7 million in the fourth quarter of 2015.
Sequential said total revenue for the year grew to $155.5 million over the year, a 76 percent increase over 2015, which saw total revenue of $88.3 million.
On an unadjusted basis, Sequential said its net income for the year came in at $21 million, compared with $20.6 million the previous year. For the quarter, the company said net income was $7.3 million.
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Sequential Brands Group chief executive officer Yehuda Shmidman said 2016 “was a productive year” for the company, led by “organic growth” and the full integration of the Emeril Lagasse and Martha Stewart brands, and the $146 million acquisition of Gaiam, a yoga apparel and wellness business.
“Looking ahead, despite a challenging macro retail environment, we will remain focused on growing our core business and maximizing operating efficiencies, inclusive of new revenue initiatives already underway,” Shmidman said.
Over 2017, Sequential is expecting revenue to hit between $170 million and $175 million and GAAP net income of $19.3 million to $21.9 million.
The company also said that it has amended the lease for its New York headquarters in order to “reduce” the size and that it will be subletting part of the office space to its operating partner in Martha & Marley Spoon, a Martha Stewart-branded meal delivery service.
“As a result, beginning in 2018, the Company is expecting an annual cost savings of approximately $4 million in direct lease savings and related cost reductions,” the company said.
A Sequential spokeswoman added: “This was part of the integration plan when Sequential acquired Martha Stewart Living Omnimedia and the new amendment allows them to create a more efficient footprint, while maintaining the flexibility to grow over the next decade on their same floor.”
The spokeswoman did not address questions of whether the lease amendment will affect any Sequential employees.